NORTH AMERICA – The Connecticut Retirement Plans and Trust Funds has earmarked as much as $250m (€192m) for a search for core open-ended commingled fund managers to invest capital in US real estate.
The pension fund heard presentations from the three finalists – JP Morgan Asset Management, Pramerica Real Estate Investors and UBS Realty Investors – for the search at its 10 July board meeting.
Connecticut will announce its final decision at its 11 September board meeting, where it will state which managers were selected and the amount allocated to each fund.
Denise Nappier, the state treasurer for Connecticut, wrote in a board meeting document that flexibility would be a key component with this strategy.
It said the flexibility of an open-ended commitment would allow for the management of queues and liquidity, enhance the ability to remain fully invested and tactically position the pension fund's core real estate within its targeted 40-60% range.
The JP Morgan Fund being considered is the Strategic Property Fund, with total plan assets of $21.9bn.
It aims for a 7.5-9.5% return over a market cycle and has a current deposit queue of $1.6bn.
The Pramerica fund is known as PRISA.
The $14.1bn fund looks for investments that can produce a 7.5-9.5% return and has an entry queue of $444m.
The pension fund is looking at three different funds offered by UBS.
The $13.8bn Trumbull Property Fund has the largest entry queue in the core open-ended fund universe.
It now stands at $2.5bn, and it would take five quarters before any new commitment from an investor would be called.
The UBS Trumbull Property Income Fund has a similar timeframe for an entry queue, even though it has just $1.bn in assets.
The other UBS fund is the UBS Trumbull Property Growth and Income Fund.
With $297m in assets, it has no entry queue.